Increasing tenant numbers struggling to pay their rent

A recent report showed that the number of landlords who were having to take their tenants to court as a way of making sure they can get their rent paid across the UK was on the rise, with an average rise of 12 per cent across the UK in the first quarter of the year.

However, this situation may be worsening according to the latest statistics released by LSL Property Services. The company said in its Tenant Arrears Tracker for the second quarter of 2013 that the number of people who were falling into debt to their landlords had increased.

In spite of an annual drop of 2.9 per cent in the number of tenants who now owe money to landlord insurance customers, LSL said that the second quarter of the year had seen a rise of 3.3 per cent.

It also added that the volume of those who are in severe arrears - where they owe at least two months of rent - had risen to sit at a total of approximately 98,000. This was the third-highest level ever recorded, with only the third and fourth quarters of 2012 having seen more people seriously behind on their obligations.

The company went on to say that the volume of people who are in severe arrears such as this accounted for 2.4 per cent of all tenancies across the whole of the UK. This had seen a rise from the 2.3 per cent that had been reported in the first quarter of this year.

However, while in the past the number of people who were unable to afford their rent could be attributed to rises in what landlords are charging, one group said that this is not currently the case in the UK.

With the rate of increase falling in the last few months, Paul Jardine, director and receiver at Templeton LPA, said it was other commitments that were causing British tenants problems at the moment.

"Slower rent rises in the last couple of months have provided some relief. However, the longer term battle is with other forms of inflation, plus unemployment and anaemic wage growth. Consumer inflation is persistently outpacing the Bank of England’s target, and escalating much faster than either rents or wages," Mr Jardine added.